Page 17 - PetVet 2022 Master Benefits Guide CA_FINAL Version

Flexible Spending Account (FSA)

Flexible Spending Accounts (FSA) run on a plan year basis (7/1 – 12/31), offering an
attractive way to pay for many health care and dependent care expenses pre-tax.

The Basics

There are two types of FSA accounts that you can participate in: a Health Care Spending Account and
Dependent Care Spending Account. Depending on your needs, you may set up one account or both
accounts with our administrator, Wex. When you enroll in the FSA, a pre-tax deduction is taken from your
paycheck each pay period and deposited into your account(s). When you need to pay for an eligible
expense, you can make a pretax "withdrawal" by either using your debit card (for Health Care Accounts
Only) or by completing a claim form and providing proper documentation (pharmacy receipts, detailed
bills or explanation of benefits).
Account Calendar Year Maximum
Use For
Contribution
Most medical, prescription, dental and vision care
expenses (like copays, deductibles, eyeglasses, etc.)
Health Care Spending $2,850(2022)
Account
Over-the-counter medications are considered
eligible expenses

Dependent Care Spending Dependent care expenses (like daycare, after-school $5,000 or $2,500 if married and
Account programs or elder care programs) filing separate tax returns

Use it or Lose it!

While FSAs save money through the deferral of tax-free money for future health care and dependent care
expenses, the money must be spent during the short plan year (7/1 – 12/31) or it is lost. Therefore, you
must carefully determine the amount of funds to be contributed to the FSA based on anticipated standard
copays, prescriptions, office visits and other planned health care expenses. You must use all the funds in
your account or forfeit the remaining balance except for the $550 roll over amount (outlined on page 17).

You will have until 3/31/2023 to submit claims for expenses occurred during the 2022 Plan Year.
Impact on Take Home Pay

Following is an example of how participants can increase take-home pay by participating in a FSA:

Example With an FSA Without an FSA
Annual Gross Pay $30,000 $30,000
Medical/Dependent Expenses $1,000 (pre-tax) $1,000 (post-tax)
Taxable Income $29,000 $30,000
Tax Deductions (@25%) ($7,250) ($7,500)
$21,750
TOTAL NET INCOME RESULT $21,500
$250 increased take home pay

 You may not use the Dependent Care Spending Account and take the Federal Income Tax credit for
the same expenses. Children must be 13 and under to qualify for dependent care expenses. This
program is also subject to certain IRS Non-Discrimination testing which may result in you being
unable to enroll in this benefit. You should consult with your tax advisor concerning these tax issues.

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